After two blockbuster months fuelled by employee discount prices; it was time for a breather. Ward’s reported Americans bought about 1.48 million cars and trucks in August for a seasonally adjusted annual rate of 16.79 million sales. Both figures are well off the records set in July but about 4% ahead of August 2004 when adjusted for daily sales rate.

All the Detroit automakers remain ahead of their 2004 paces in year-to-date (YTD) sales. Ford led the Big Three last month with a 1.4% improvement. While sales of the Mustang sports coupe and convertible have cooled a bit recently, the Five Hundred sedan and Focus sedan/hatchback line have had two good months back-to-back. The F-series truck set an August record with over 90,000 sales, putting the blue oval within 18,000 sales of recapturing the brand sales crown from Chevrolet.

While things improved on the home front, most of Ford’s luxury marques were suffering. Land Rover set a new August record, but Volvo and Lincoln have now been overtaken by Infiniti. Jaguar dropped to last among major premium brands as it was outsold by Porsche.

Chrysler posted its 17th month of improved sales with a 1% gain driven by outstanding Jeep sales. The new Grand Cherokee SUV looks to be a hit: YTD sales are up 23%. The new Charger sports sedan posted solid numbers which is fortunate as sales of the Chrysler 300C sedan have slowed in the past few months.

Chrysler’s segment-leading minivans stumbled in August with the Caravan hanging on to a narrow lead over the Honda Odyssey. The Town & Country dropped to fourth behind the Toyota Sienna.

With the exception of the nearly irrelevant Isuzu, GM was the big loser in August. Sales were down 16%, leaving the General’s market share under 24%. Even adding selected 2006 models to its employee discount promotion didn’t help. Car sales were down 11.5% and light trucks took a 14.5% plunge. The SILVERADO pickup missed taking one of the top two sales spots for the first time since September 2002 as it was outsold by the Honda Accord, which unseated the Toyota Camry as best-selling car for the month.

Cadillac, which had been second among luxury brands in recent months, slumped to third in YTD sales.

The majority of automakers beat their 2004 marks in August. Honda and BMW had all-time record months. Toyota couldn’t produce another best-ever month but set a new August record as did Hyundai and Mercedes, where sales of the new M-Class SUV were up more than 50%. Even Volkswagen and Mitsubishi sold more cars than in August 2004, though this year’s extra selling day still left both in the red. Audi is now 0.7% ahead of its 2004 YTD pace.

After a couple of strong months, sales of large SUVs and pickups slowed last month while passenger car sales were almost 10% higher than they were in August 2004.

The next few months will be hard to call. Hurricane Katrina may ultimately provide a boost in new vehicle sales as thousands of cars and trucks are replaced. However, the magnitude of the damage may mean it will be months before those sales appear.

Chrysler, Ford and GM will continue offering their employee pricing programmes, but dwindling supplies of eligible vehicles may limit their future impact. In addition, near-record or even new record fuel prices will likely be a factor in the American economy for September and possibly beyond. If there are continuing problems with domestic refining capacity, it is likely petrol prices will become an increasingly important part of consumers’ new vehicle buying decisions.

Bill Cawthon

click table to enlarge

click table to enlarge

click table to enlarge